State govt raises car loan limit for legislators from ₹10L to ₹30L

A day after the state government decided to bear the monthly salary of the drivers of 367 legislators, it increased the loan amount for them to buy new cars to ₹30

A day after the state government decided to bear the monthly salary of the drivers of 367 legislators, it increased the loan amount for them to buy new cars to ₹30 lakh.

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The current amount was ₹10 lakh, with the interest being paid by the state.

On Friday, deputy chief minister Ajit Pawar announced the increase in the loan limit.

“There are many new legislators who find it difficult to purchase a car with the existing limit of ₹10 lakh. We have decided to increase the loan limit to ₹30 lakh to be repaid by the borrower, while the interest will be paid by the government,” Pawar said.

The government pays the interest up to 10% on the loan raised by the legislators, while the loan is repaid by the legislators in five years.

A total of 289 MLAs in the legislative Assembly and 78 in the council get a monthly salary and allowances of ₹2.32 lakh, and 15 other benefits, including medical facilities; interest-free loans for cars; free air, rail (limited distance) and bus transport facilities; residence in Mumbai, among others.

The state legislature on Thursday had passed a bill to pay a monthly salary of ₹15,000 to drivers of legislators, which meant an annual burden of ₹6.6 crore on the state exchequer.

The legislature had also announced plans to fit personal state-of-the-art tablets inside the Assembly, which is expected to cost the government ₹4 crore.

State officials are wondering whether there was a need to increase the loan limit to ₹30 lakh when most cars and SUVs are available below ₹20 lakh. According to an official from the finance department, this was an unwarranted burden on the exchequer. “Even most of the high-end SUVs do not cost more than ₹20-25 lakh. Raising the loan entitlement three times the existing limit is uncalled for,” he said.